The Chairs, Dr Musharraf Hussain and the Rt Revd Richard Cheetham, asked Archbishop Rowan to respond to a number of issues that had been raised in the discussions before he had arrived.

The Archbishop of Canterbury responded:

Well frankly yes, it is a rather tall order, and coming into the middle of a conversation is always a bit of a challenge. What I'd like to do, if I may, is comment on the five questions that came up, and just pick up a couple of points that came up in the general discussion, and perhaps wrap it up by asking whether there are three or four principles that the faith perspective can deliver into this situation.

Now I don't propose to offer definitive answers to the five questions, but just to reflect a bit on where they might take us.

The first question was about what faith communities can do to educate people more deeply, financially. As will be apparent from some of the rest of what I'd like to say, any faith community is likely to respond by saying "you can't treat this issue in isolation. It's not just about finance; it's about how you understand what you are like as human being. It's about motivation on a very broad base". I'll come back to that a bit later. But, I would hope that faith communities will continue to develop their own commitment to forms of finance credit that are manifestly locally effective. As some of you will know, I have a great bee in my bonnet about credit unions and I'm very happy to give that particular bee an airing this afternoon because I think that is very much a form of ethical financial practice. It doesn't seek to make detached profits, it's based on relational notions, it seeks, primarily, local effectiveness and the capacitating of people in their ordinary relations and choices.

That's not to say that I'm ignoring the macro world, and I'll come back to that in a moment too. But unless people have the opportunity of understanding a bit in the local context what it's like to have some measure of intelligent control over their financial affairs, then they won't be approaching macro credit and macro financial institutions intelligently either. So I think that the manifest commitment of local faith communities to micro credit is one small but significant element that can be put into this situation. And, it's been very interesting to see in the last ten years or so how much that particular set of issues has moved further towards the centre of the stage for a number of people in the world of faiths. I hope to see it move further.

The second question was about what responsibilities faith communities have to highlight and address financial asymmetries with regard to tax revenues; between, and I like this phrase, 'the bank too big to fail and the debt too small to write off'; the balance of revenue lost to developing countries as against aid, and so forth. My first response is simply to say that the responsibility is what it always is on faith communities, which is to tell the truth. Faith communities in developed economies and societies are in a particularly strong position because of their international links and affiliations, to spread the word from those in other parts of the world who are at the sharp end of this. So telling the truth, which is something that we all ought to be doing all the time, becomes in this context a matter of letting some of the uncomfortable truths about poverty elsewhere simply get there onto the radar of more prosperous environments.

That's part of it, but I think the issue behind the question was deeper. It was also about methods and priorities in addressing the situation and what faith communities ought to be putting their energy and their support behind. I think there are two issues there which I want just to underline briefly. One is an issue that's already been touched on a bit here, and seems to me to be of huge importance in this whole setting. Some people have been saying this for a very long time but nobody really listened. And this first issue is actually about democracy, as simple as that. What is the balance in the world between democratically elected institutions, and unaccountable financial corporations?

Now, that's never a black and white, simple polarisation, but I don't think it can be denied that in instances, there's been massive imbalance between what a local democracy might want to achieve and the effects of pressure; whether of business or of international financial institutions, skewing the priorities of a locally elected government. How do we so keep an eye on this such that democracy retains its place and its power in the whole pattern of our interrelations? I think that is an important, and not an easy question. But I think that's one of the things that faith communities ought to be talking about, ought to be pressing. What's the place of elected democracies in the management of the world's finance? How do you balance that with the necessary flexibilities and necessary porous boundaries in the financial world? What's the balance? I said I wouldn't have an answer to that but I think that's the question I'd want to push which of course does carry with it the slightly more technical question of how one regulates capital flow. There are those who would say: "the important thing is to make sure that capital is not taxed more highly than income so that there isn't an incentive to get capital out of the country" and so on. These are technicalities that as a non-economist I just quail at the thought of and can't begin to comment on, but they seem to me to be quite good questions and they have to do with that fundamental issue of how the dignity, the liberty, the autonomy of the local is properly affirmed and sustained so that you don't have a global situation in which if you begin to tilt it, everything slips down to one end.

The third question was about how can faith communities educate about the moral and spiritual values which should underpin economics? Well, where do we start here? Again, just two points to start with about sharing and distribution. I think one of the elements of sharing is sharing risk. One of the things that seems to be going wrong in skewed or failing or distorted financial situations is an un-equal sharing of risk. That is, the protection of some at the expense of others, whether that's through protectionism in the strict sense, or whether it's through investment practices that so seek to minimise risk for the speculator, that their effect overall is de-stabilising, rocking the entire system at the cost of those most vulnerable. So I would just want to add the footnote to the sharing question the issue of risk sharing. Behind this question of whether religion is failing to teach how much is enough, lies the point that I touched on a bit earlier: it's all about what we think human beings are there for.

It's about the sense of self. I remember a very powerful essay I read many years ago which said rather gloomily that the trouble with the Sermon on the Mount, and similar great ethical principles, is that they're addressed to people who are not there; they're addressed to people who haven't yet grown into the fullness of being able to understand what that's about. The challenge, therefore, is to grow the kind of maturity in believing people that is capable of approaching financial other issues with a particular kind of patience, a particular kind of trustfulness, and a particular kind of willingness to take the right risks. So it's not separable from that overall question of formation. I think one of the real challenges for all faith communities and all strands of all faith communities, whether they call themselves liberal or conservative, the challenge is to say "faith is not simply about holding certain things to be true". It is, as a Christian would say, "living in the truth". That is, allowing the truth to shape your options and your vision. The more we get stuck on the model of faith simply as the mind assenting to certain things being true, the worse it gets because it doesn't have that transformative effect on the whole of our motivation, all our sets of options. So it's rather a big answer to a big question . Are we failing to teach? Well yes, we are. But it's not just that we're failing to put one item in the list of good things we ought to teach people about, there's a deeper challenge, and perhaps a deeper failure about how we shape mature human beings in the image and likeness of God as a Christian would put it.

I was fascinated by the observations on interest, and I'm more and more interested in the history of how we've thought, both as Christians and as Muslims, about interest. We began to part company, I think, about 500 years ago, when Christians started thinking afresh about interest, and if you want to give a very unkind assessment, Christians began wriggling around the difficult bits, to justify it. But I would also say that it's not all like that. Some for example of that early Calvinist justification of interest was not about uncontrolled profit-making. It was about facing honestly the question, 'What's the price of risk'? And I think that's a good question.

And what I've read of some Muslim commentators would suggest that they recognise that it's a fair question – 'What's the price of risk'? If you are actually risking capital, then there is a question about what is the appropriate reward. Is it just to be calculated in absolutely flat numerical terms, or is risk itself a factor in discount? I think it's a fair question, and I think there could be some very interesting answers to it in our present context, where that level, which is not unconnected with sharing risk, that level of discussion doesn't always surface. But I'm glad that we have, in our conversation, that element of sharp challenge to some of the unquestioned assumptions about interest. As a Christian, I think I would want to say, I'd like to ask what "just interest" means or looks like in an economy like ours.

But can the legal framework accommodate ethical monitoring? I'm sure the legal framework should, in certain ways. Whether it can, others around might have views on because it's very much walking on eggshells. We've seen the appalling things of dirigisteeconomics, directive economies which allow no creativity, no flexibility, and none of that investment for the common good which I think was rightly drawn to our attention.

So, there are many big questions there, and some of them have to do with regulation, not simply to do with government or legislation, but to do also with the creation of a common culture in financial institutions with sanctions that are not just legal, but also relational against people who go off the rails in one way or another. And I'll be very interested to see what is possible to imagine in relation not only with the FSA but also perhaps the World Trade Organisation. And again, many people have said over the last decade or so, that what we need is a revived, re-imagined, proactive WTO which takes some of this role to itself, not only looking at financial transactions but also at investment patterns within a country, where the need lies. It's a very general observation, but part of the answer.

And I'd also note there, being very appreciative of what was said about Muslim concepts of levels of spending. Part of our failure sometimes to form people's minds and priorities is a forgetfulness about the days when Christians had some notion of what the cardinal virtues were. We don't talk a lot about the old virtues, but prudence and temperance figure quite largely in traditional Christian ethics, Catholic and Protestant, and they are precisely to do with these questions, prudence and temperance. How do you fit your policy to your aims; temperance, how are your aims controlled by your sense of what is appropriate in an interconnected, balanced world. I would quite like to see us dusting off prudence and temperance and asking what they might mean as personal and corporate virtues in our present setting.

And then some observations. I was very, very impressed by two particular things that were said here: about the relational base of the entire system we're talking about; and about the ease with which we forget that we live in a world of material needs. I'm in the throes of trying to write something a bit longer on all of this stuff, and that's actually at the heart of what I want to explore, because I think understanding oneself as belonging in the world, not floating six inches above it, and planning, dealing and profiting without any engagement with the materiality, that's one of the great evils of the day.

So that rang a lot of bells with me. But of course the fundamental challenge was the lack of clarity about what we want out of the system, and that really does connect with the very interesting and very pertinent question about how we define wealth, which came up in the discussion. How we manage the multifaceted relations involved, I won't begin to try and answer. I think all I can do by way of pointing at an answer is actually to go back to some of the things we've been saying, and I've been saying earlier: about what levels of management are adequate to preserve flexibility and liberty, and yet sufficiently robust to protect the vulnerable. And if, to suggest again a definition that I'd quite like to explore, if ethics is in large part about protecting the vulnerable, then that's got to be the bottom line here, I think.

So, those are my non-answers to the various questions, but before I sit down perhaps I can venture two or three further thoughts with, as I say, some possible basics emerging from this discussion. Let me turn to the definition of wealth first. As I heard the question, what came to my mind was one of the most regular and powerful images in Hebrew scriptures of wealth and peace: everyone sitting under their own vine and their fig tree; or wealth as seeing your children's children. It struck me that the biblical notion of wealth, if you start with it there, is about two things which very readily fall off the edge of our present discussion. They're about confidence in the future – seeing your children's children – and they're about a harmonious, long-term relationship with the environment – vines and fig trees. And I'd just sort of throw that out as a way of getting into a concept of wealth, a religious concept of wealth that respects the sense that we are part of an interlocking world, and that we have a charge for our future, that there's a question, as somebody said earlier, of doing justice to the next generation coming in here, environmental concerns being grounded in that sort of interest.

I was very struck by the question about anger, and I think we do ignore, at our peril, a very high risk which history should have taught us if it teaches us anything: a very high risk of financial stringency leading to political extremes – anger finding its expression in xenophobia, prejudice, rivalry, all the tactics that both sociologists and psychologists remark on as the displacement of unease and fear. And I think you're quite right to underline that it's no small thing. And as someone remarked to me in a discussion around these issues only yesterday, the fact that the BNP can win a seat in Sevenoaks is a straw in the wind, and we have to watch the horizon very, very carefully for the tempest that might be behind that.

I'm fascinated by the point about production and consumption not being now primarily of 'hard stuff', but of goods and services that were inseparably, if you like, intellectual and material. It doesn't entirely answer the question of what, if you like, stands behind and makes possible the iPod and the downloading of music, which is of course a level of sophistication about energy consumption and its methods, which again could be more vulnerable than we think in a few decades' time. That's just a comment, I'm very interested by that though.

So finally, what might be some of the most basic faith-derived or faith-related values that we might want to put into our present crisis and its challenges? And I'll simply suggest three. First – we've been reminded of this in various ways this afternoon – first, keeping promises. On the whole, religious people believe in a divine agent, power or presence that is faithful, consistent, dependable, truthful. As we seek to live a life that is in harmony with that divine reality, then faithfulness and trustworthiness are utterly fundamental to how we approach our sense of the good life. And a very important point was made, I think, earlier on, when it was noted that the further away you are from the people you're contracting with, the harder it is to keep a lively and vivid and self-critical sense of the necessity of keeping promises. So religious people believe promise-keeping is a good thing. It's very basic, almost primary-school stuff, but none the worse for that, I'd say.

Second, I'd want to pick up what I've already mentioned: the sense of living in a world that does not belong to you and is not simply under your control. It is a gift to be stewarded and creatively and justly used. And going with that, of course, the sense that your own will and your own desires don't necessarily define what's good for anybody or anything. You have to learn your relatedness to the world in which you're set. So, keeping promises, understanding that you belong in a world that's limited, that's not wholly under your control – that is, as Christians, Jews and Muslims would certainly say, created, and therefore not just in your hands to be owned. And I'm always struck from the days of the Jubilee 2000 campaign onwards with the way in which in Leviticus in the Hebrew Scriptures, we're told very firmly that the land is, so to speak, lent to you. You don't own land as a thing; you control the profits of the land over certain limited periods, because the land belongs to the Lord. The earth is the Lord's, and all that is in it, and that, I think, is again the fundamental principle.

And the third religiously derived and related principle, I would say, is picking up the community point that was raised earlier, the belief that ultimately, what is good for me and what is good for you are not detached, separate, non-connecting things. Finally, my life and your life belong together. My flourishing and your flourishing belong together. If I start saying that I can define what's good for me with absolutely no reflection on what's good for you, I undermine the entire principle of ethics. I make it entirely a matter of self-interest. Start there, and the crack goes throughout the whole moral system, I'd say. So, common and convergent good, what's good for me and what's good for you, belong together. That, I think, is a profoundly religious principle, because again of that belief which we share: that there is a peculiarly special relationship between human being and human being, rooted in their common relationship to their creator. We as Christians talk about the image of God, and Jews also. Muslims talk about the sense of humanity and creation, the khalifah principle. But however we put it, there is that sense that humanity is, in some sense, one. As a Christian, that would go still further, to the imagery of the body of Christ, in the sense that the suffering of one becomes the suffering of all, and the wealth or welfare of one becomes the wealth or welfare of all.

So those are three principles which I think are worth focusing on as distinctively religious insights into our present condition: promises are to be kept; the material world is to be respected and our limits are to be understood; and we are to understand the good of one and the good of all as inseparable. And perhaps if we can find ways of translating those into policies and politics, we may have done what we can as religious believers to serve the wider community in which God has placed us. Thank you very much.